Japan's Nintendo expects annual profit to more than double this year to above market forecasts on strong sales of its DS handheld console and game software, it said today, sending shares up 2.4 per cent.
Nintendo raised its operating profit estimate by 28 per cent to 185 billion yen ($1.55 billion) for the year to March 31st, from a previous forecast of 145 billion yen. The company posted a 90.3 billion yen profit last business year.
Nintendo DS, which opens like a book and lets users control play with a stylus, has allowed the company to reach new user groups such as women and the elderly with software that includes "Nintendog," a pet training game, and quiz programmes.
The company is also betting on its new Wii console, which was launched for the year-end shopping season in the Americas, Japan and Europe, to fend off competition from Microsoft Corp.'s Xbox 360 and Sony Corp.'s Playstation 3.
Analysts had expected Nintendo to post a profit of 155 billion yen, based on an average forecast from 17 brokerages compiled by Reuters Estimates.
The earnings upgrade "underlines the strength of the DS and that the Wii is off to a flying start", said Hiroshi Kamide, an analyst at KBC Securities.
"At this rate they are going to be a 1 trillion yen sales company next year, which is pretty amazing," he said.
Nintendo also lifted its revenue forecast by 22 percent to 900 billion yen from an earlier target of 740 billion yen. That compares with sales of 509.2 billion yen the previous year.
The company also raised its annual dividend forecast to 480 yen from an earlier estimate of 400 yen.
Kyoto-based Nintendo raised its sales target for the DS game player by 15 percent to 23 million units in the year to March.
It also increased its sales forecast for Wii game software by 23.5 per cent to 21 million units, while reiterating a target of six million units for the console itself.
Wii features a motion-sensitive controller which the users swings around to control the play.
Shares of Nintendo closed up 2.4 per cent at 29,150 yen after the company announced its revised forecasts, against a 1.7 per cent decline in the overall market.